Medical costs comparison

How out of pocket medical costs work in Australia

If you have Medicare, you have 2 options for receiving hospital treatment: public or private. In the public system, Medicare will generally pay all of your costs.

If you choose private hospital care, your costs can be covered in a few ways. Medicare will still pay some, but a private health fund can also cover some of your fees. If you don't have private health cover, then you'd need to pay for the entire private procedure. If you do have private hospital cover for your treatment, then there may still be out of pocket costs.

Finder survey: How many Australians of different ages worry about being able to pay for medical bills?

Compare medical costs across Australia

The table below compares some costs of common medical procedures in 5 different states. The data comes from Medical Costs Finder, a tool managed by the Department of Health and Aged Care. The data was last updated on 29 September 2023.

• Typical specialists’ fees refers to the cost of specialists, assistant surgeons, and anaesthetists. It doesn't include hosptial fees, which are generally either mostly or fully covered by private health insurance funds.
• Patients typically paid refers to the the median amount paid by the typical patient, after Medicare and Private Health insurance benefits were paid.
• Patients typically paid refers to the the median amount paid by the typical patient, after Medicare and Private Health insurance benefits were paid.
• % with no out-of-pocket costs refers to the proportion of partients that didn't have to pay any out of pocket costs.

• NSW
• VIC
• QLD
• SA
• WA

Frequently asked questions

• What is a 'no gap' or 'known gap' arrangement?

  "No gap" is an agreement where your specialist charges only the Medicare Benefits Schedule MBS fee. Your private health fund then covers the remaining amount above what Medicare pays, meaning you have no out-of-pocket costs for the doctor's fee. A "known gap" arrangement means your specialist charges a bit more than the MBS fee but has an agreement with your health fund to limit your out-of-pocket payment to a specific agreed amount. This means you will pay a small fixed fee per service. Always confirm these arrangements with your specialist and health fund before any treatment.

• What is the cost difference between public and private hospitals?

  In a public hospital you will generally not pay any out-of-pocket costs for treatment if you are admitted as a public patient. Medicare covers all the costs including doctor's fees and accommodation. In a private hospital you will typically have out-of-pocket costs. Medicare pays 75% of the Medical Benefits Schedule MBS fee for your doctor's services and your private health insurance will cover some of the remaining fees and hospital costs. Any amount charged by the doctor above the MBS fee becomes your out-of-pocket expense or gap.

• Does private health insurance cover emergency department visits?

  Private health insurance generally does not cover the cost of emergency department visits in either public or private hospitals. These services are typically covered by Medicare. If you are admitted to a private hospital from the emergency department, your private health insurance would then start to cover your inpatient costs according to your policy and any applicable waiting periods or excesses. If you attend a private emergency department and are not admitted you will usually pay for the consultation yourself.

• Are medical out-of-pocket expenses tax deductible in Australia?

  Generally most out-of-pocket medical expenses are not tax deductible in Australia. However there are specific situations where some medical related expenses might be deductible, such as for certain medical travel or if you are eligible for the National Disability Insurance Scheme (NDIS). It is always best to check with a qualified tax advisor or the Australian Taxation Office for personal advice.

• How do health insurance waiting periods impact out-of-pocket costs?

  Waiting periods are the time you must wait after buying your health insurance before you can claim benefits for certain treatments. If you receive treatment during a waiting period you will have to pay the full cost of the service yourself leading to out-of-pocket expenses. Common waiting periods include 2 months for most hospital treatments, 12 months for pre-existing conditions and 12 months for obstetrics or weight loss surgery. Always check your policy's Product Disclosure Statement PDS for specific waiting periods.

• What is the difference between hospital cover and extras cover?

  Hospital cover helps pay for the costs of in-hospital treatments such as accommodation, theatre fees and doctor's fees when you are admitted as a private patient. This covers services like surgery, diagnostic tests and intensive care. Extras cover sometimes called ancillary cover helps pay for services received outside of a hospital. This can include things like dental, optical, physiotherapy, chiropractic treatment and remedial massage. It is designed to cover day-to-day health services.

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Tim Bennett

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A seasoned journalist with over 10 years of experience in news, politics and finance reporting, Tim has previously held roles at the ABC, SBS and Fairfax Media. Tim’s expert insights have been quoted in The Australian, The Daily Telegraph, The Courier Mail and more. He regularly appears on TV and radio, and has been interviewed on 7 News, Sunrise, SBS News, ABC Local, 3AW and 5AA. Tim is passionate about simplifying complex insurance topics for Australian consumers. He holds a Bachelor of Arts (Politics) from Macquarie University and a Tier 1 General Insurance (General Advice) certification, which meets the requirements of ASIC Regulatory Guide 146 (RG146). If you’re interested in a media interview with Tim, please reach out to our PR team at aupr@finder.com. See full bio

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Gary Ross Hunter has over 6 years of expertise writing about insurance, including life, health, home, and car insurance. Having reviewed hundreds of product disclosure statements and published over 800 articles, he loves simplifying complex insurance topics for everyday readers. Gary has contributed to major outlets like Yahoo Finance, The Sydney Morning Herald, and news.com.au, and holds a Bachelor of Arts (Honours) in English Literature from the University of Glasgow, along with a Tier 2 General Advice certification, ensuring his work adheres to ASIC’s RG146 standards. See full bio

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